On Friday, Oppenheimer shifted its stance on Array Technologies (NASDAQ: ARRY) shares, raising the stock from Perform to Outperform with a new price target of $20.00.
This upgrade comes in the wake of Array Technologies' first-quarter results which showcased solid performance and robust bookings. The firm has also reaffirmed its guidance for 2024.
Array Technologies has effectively addressed key concerns previously noted by Oppenheimer. The company's introduction of the H250 and OmniTrack products has expanded its reach into new market segments.
Additionally, the adjustment of DuraTrack pricing to reflect cost declines is contributing to a significant acceleration in sales. These strategic moves are expected to position Array Technologies for substantial growth.
The company's commitment to maintaining cost discipline while simultaneously investing in product improvements is another factor that has contributed to the upgrade. Oppenheimer anticipates that this approach will likely result in better than expected operating leverage for Array Technologies.
The price target set at $20.00 is based on a 12 times multiple of the projected 2024 adjusted EBITDA, which is estimated to be $295 million. This valuation reflects a positive outlook for the company's financial performance and growth prospects in the coming year.
InvestingPro Insights
In light of Oppenheimer's upgrade of Array Technologies (NASDAQ: ARRY) to Outperform, recent data from InvestingPro provides further context for investors considering the stock. With a market capitalization of $1.9 billion and a P/E ratio that has hovered around 22, ARRY is trading at a high Price/Book multiple of 7.32 as of the last twelve months ending Q4 2023. Despite a slight revenue decline of 3.72% in the same period, the company's liquid assets have been reported to exceed its short-term obligations, suggesting a sound liquidity position. Moreover, analysts have noted that ARRY's stock price movements have been quite volatile, which is reflected in a 17.81% drop in the 3-month price total return.
InvestingPro Tips indicate that while Array Technologies does not pay dividends, it has been profitable over the last twelve months and analysts predict the company will remain profitable this year. Additionally, ARRY operates with a moderate level of debt, which could be a reassuring sign for risk-averse investors. For those seeking a deeper dive into ARRY's financials and future prospects, InvestingPro offers additional tips. Use the coupon code PRONEWS24 to get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, and unlock these insights at https://www.investing.com/pro/ARRY.
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